Avast Software, a portfolio company of CVC Capital Partners and Summit Partners, has agreed to an all-cash purchase of all outstanding ordinary shares of AVG Technologies (NYSE: AVG) for $25 apiece, a total consideration of about $1.3 billion and a 33% premium over Wednesday's closing price. The deal combines two security software businesses founded in the Czech Republic that between them boast a network of more than 400 million endpoints.
The deal was made with an eye turned distinctly toward the future. In addition to some of the typical reasons for acquisition, like expanding geography and adding scale, Avast said it’s buying AVG with plans to deepen its offerings in emerging tech markets, such as security for the IoT. Avast will supply $150 million in equity for the transaction, with Credit Suisse Securities, Jefferies and UBS Investment Bank committing an additional $1.69 billion to support the deal. Summit Partners invested $100 million in Avast in 2010, while CVC acquired a significant minority stake during 2014. AVG has been publicly traded since 2012.